DEAR PRIME MINISTER,
DEAR MEMBERS OF PARLIAMENT,
DEAR DEPUTY PRIME MINISTER,
DEAR MINISTER OF AGRICULTURE AND FOOD,
American Chamber of Commerce in Bulgaria would like to share its’ understanding and position regarding the observed inflationary trends, rising prices of consumer goods and services, and the political will you have expressed to address these issues. Our business association supports the fundamental objective of the draft legislation to curb unfair trade practices, increase transparency throughout the supply chain, develop the comprehensive conditions for effective competition in our markets, and protect Bulgarian consumers. We have always maintained that regulations at the national level should not duplicate or overlap with those already in place in our country and arising from our membership in the European Union. The approach to retaining investors and increasing confidence among both citizens and businesses – which is the only economic entity that creates real added value for the economy and society – must be balanced, predictable, and consistent with the principles of free enterprise and EU law, and the measures implemented pursuant to it must be thoroughly discussed with a broad range of business representatives.
We have observed the development of public discussions on the topic with concern and interest, and we appreciate your dialogic approach. However, the changes you have proposed through the aforementioned draft laws would lead to a significant disruption of the established and functioning business environment in our country, as well as the fragile competitive landscape in which a wide range of economic actors operate, each with varying influence on the formation of final consumer prices. Therefore, it is necessary to discuss the potential economic effects of the proposed legislative changes, the possible legal consequences, and the difficulties that will inevitably arise during their implementation. For this reason, we are presenting our position regarding the two bills:
With regard to the Bill to Amend and Supplement the Competition Protection Act:
Lack of public consultation and impact assessment
The one-week deadline set for submitting proposals between the first and second readings does not meet the requirement of Article 26, paragraph (2) of the Law on Normative Acts (LNA), according to which public consultations with citizens and legal entities must be held during the process of drafting a normative act. After the conclusion of the public consultation and prior to the adoption of the legislative act, the draft’s author publishes a summary of the proposals received, along with a justification for the rejected proposals. The lack of genuine public consultation deprives affected parties of participation in the rule-making process and undermines the principles of transparency and predictability.
Delegation of Essential Elements to the Sub-Legislative Level
The bill provides for the possibility for the Council of Ministers to define additional unfair commercial practices through a regulation. Thus, essential elements of the regulation are removed from the legislative branch, creating a risk of arbitrariness stemming from populism and, consequently, leading the country’s economy toward instability and unpredictability in the legal framework.
Vague legal concepts and risk of arbitrariness
New concepts are introduced without sufficient specificity, which creates conditions for inconsistent practice and penalties of up to 10% of turnover. The lack of clarity places businesses in a state of legal uncertainty.
“Joint dominant position” without proof of concerted conduct
The amendments to the Competition Protection Act allow for the establishment of a joint dominant position for which “proof of an explicit agreement or concerted practice between the undertakings is not required.” This significantly expands the powers of the Commission for Protection of Competition (CPC) and creates a risk of subjective assessment and sanctions without a sufficient evidentiary basis.
Vague definition of “excessively high prices”
Once again, a concept of unclear legal and economic origin is being introduced into the legal sphere and public discourse, based on elastic criteria such as: “reasonable profit margin” and comparisons with other countries, without taking into account market specifics, costs, and tax regimes, as well as “a significant increase over a short period without economic justification.” The criteria will be determined by a subordinate act of the Council of Ministers, which exacerbates uncertainty, as the same subordinate act should also clarify how it will be determined whether the prices of any goods or services are proportional to their economic value.
Central Registry for Traceability – Additional Administrative Burden
A central registry with a broad scope of data on the supply chain is being introduced. Despite the stated goal of optimization, in practice this is yet another significant administrative burden, a drain on resources, and unplanned investments for businesses.
Numerous new prohibitions on unfair practices
Over 20 new absolute prohibitions on unfair commercial practices are being introduced; a large portion of them are vague and contradictory, while others are also included in the section on conditional prohibitions, which further creates confusion and sets the stage for violations.
Interference in pricing and market logic
The new prohibitions interfere with pricing policy and the negotiation of promotions, which could lead to price uniformity, reduced competition, and higher prices for the end consumer. In reality, this is an attempt to impose a centralized approach, which is unacceptable for a country with a functioning market economy that is a member of the European Union and a candidate for OECD membership.
The introduced ban on price markups differing by more than 10% within a single product group, together with the existing ban on unjustified price increases under the Law on the Introduction of the Euro in the country, leaves the merchant with two choices – either to lower the markup on all goods in the category or to stop selling the item with the lowest markup. This could lead to the disappearance of the cheapest products.
Shifting the Burden of Proof
A mechanism is being introduced whereby, in cases of suspected violations, businesses must prove that they have not committed such a violation; this would constitute a gross violation of a fundamental legal principle – the presumption of innocence – as in cases where the CPC suspects unfair practices, the trader may be required “to provide evidence within a specified short period that the practice is not unfair.”
With regard to the Bill to Amend and Supplement the Consumer Protection Act:
Regarding the procedure for drafting and adopting the bill
Once again, there was no public consultation or thorough impact assessment. The bill was submitted directly to the National Assembly and reviewed the very next day by the relevant committee – thus excluding us and a number of stakeholders from the legislative process. This shortcoming was partially offset by discussions held with some business representatives in Bulgaria.
We see no real justification for this excessively rushed approach, as the bill itself is scheduled to take effect on August 9, 2026, which does not necessitate urgent adoption without public debate. The lack of consultation undermines the legitimacy of the proposed measures and creates a risk of adopting ineffective or unenforceable provisions. And this also carries political risk.
Delegation of Essential Elements to the Sub-Legislative Level
A significant portion of the key elements of the legal framework are not addressed in the bill itself but are deferred to future regulations to be adopted by the Council of Ministers. This applies both to the concept of a “comparable previous period” and to the procedure and method for assessing the “economic justification” of the increase.
Furthermore, at present, the Consumer Protection Commission is already conducting inspections for unjustified price increases under the Law on the Introduction of the Euro, without a publicly available methodology for conducting them. In this context, it is unclear why a new methodology needs to be adopted instead of ensuring transparency in the existing practice.
Entry into force in the absence of key subordinate legislation
The Transitional and Final Provisions stipulate that the law shall enter into force on August 9, 2026, with the methodology under Article 68n, paragraph (8) to be adopted within three months thereafter. This means that the law will be applied in the absence of fundamental rules for its implementation, which creates legal uncertainty for those subject to the provisions, a risk of inconsistent administrative practice, as well as difficulties in exercising oversight. We find such an approach incompatible with the principles of predictability and stability of the legal framework.
The Concept of “Fair Price”
The draft law reintroduces the concept of “fair price,” which will be determined according to a methodology established by the Ministry of Economy, Investment, and Industry. Although the explanatory memorandum emphasizes the informative nature of this indicator, the lack of clear criteria and predefined principles in the law creates conditions for administrative interference in pricing, a violation of free enterprise, and distortion of competition.
Administrative Burden on Businesses
The bill also provides for an extension of the obligation for certain merchants to publish price information daily in a machine-readable format. Extending this regime for another year maintains a significant administrative burden, leads to additional costs for businesses, requires the maintenance of technological and organizational infrastructure, and creates a disproportionate burden, especially given the existing requirements.
DEAR PRIME MINISTER,
DEAR MEMBERS OF PARLIAMENT,
DEAR DEPUTY PRIME MINISTER,
DEAR MINISTER OF AGRICULTURE AND FOOD,
In light of the above, we believe that the proposed Draft Law Amending and Supplementing the Competition Protection Act and the Draft Law Amending and Supplementing the Consumer Protection Act significantly expand the regulatory framework by introducing new concepts, prohibitions, and control mechanisms.
Although the stated goal is to protect competition, suppliers, and consumers, in their current form, the texts create legal uncertainty and conditions for administrative arbitrariness, restrict freedom of contract and market-based pricing, increase the administrative and regulatory burden on businesses, and may also lead to negative effects for end consumers through higher prices and more limited choice.
In light of the above, we categorically oppose the adoption of the bills in their current form, and we consider it necessary to conduct a genuine public consultation, prepare a thorough impact assessment, clarifying the definitions and scope of the regulation, and ensuring a balance between the protection of competition, free enterprise, and the protection of consumer rights.
Based on everything stated above, we share the positions of the Association for Modern Trade, the Association of Bulgarian Employers’ Organizations, and “Food and Beverages Bulgaria.”
We remain open to dialogue.
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